BATON ROUGE, La. – Louisiana Economic Development (LED) and the Louisiana Department of Transportation and Development (DOTD) released the results of an analysis commissioned by the two departments to assess Louisiana’s competitiveness relative to attracting a major increase in container traffic volumes, as well as to examine a variety of options for achieving increased container volumes over the next 20 years.
“International trade has long been a major driver of Louisiana’s economy. With the upcoming expansion of the Panama Canal, the timing was right to take a hard look at how Louisiana can best position itself relative to attracting containerized cargo over the next 20 years,” said LED Secretary Stephen Moret. “The results of the analysis certainly suggest a significant growth opportunity for container volumes, but they also indicate that we should not neglect our traditional strengths in bulk products where we have several distinct competitive advantages. Accordingly, we plan to focus additional attention on identifying opportunities to strengthen our competitiveness in bulk products.”
“This is an excellent report that, combined with other recent port analyses, provides a blueprint for public policy decisions with respect to ports and containers,” said DOTD Secretary William D. Ankner, Ph.D. “I look forward to working with LED and the port community to capitalize on the opportunities presented in this report.”
Key findings of the analysis, which was conducted by A.T. Kearney, include:
• Louisiana container ports are most competitive on two trade lanes: (1) trade between any overseas market and the local Louisiana/Arkansas market and (2) the North-South trade lane with Latin America.
• Louisiana’s container volume is expected to nearly triple over the next 20 years, from approximately 235,000 20-foot-equivalent-units, or TEUs, in 2008, to approximately 660,000 TEUs in 2028.
• Louisiana’s current container facility at the Port of New Orleans’ Napoleon Avenue Container Terminal should be able to accommodate the forecasted container volumes through 2028 by making some operational improvements and limited infrastructure development.
• Any greenfield, transformational port concepts intended to add significant incremental container volumes would have several economic and operating challenges to overcome. These challenges include increased distance for vessels to travel, extended end-to-end shipping cycle times, additional handling costs, a requirement for supporting infrastructure and/or potential competitive responses from railroads and trucking carriers.
• Louisiana enjoys a unique competitive advantage for bulk products because of its geographic location and the Mississippi River. Additional targeted efforts to expand bulk products opportunities (not an objective of this particular project) likely would yield positive results.
A.T. Kearney’s analysis was based on four major inputs: the comparative results of an end-to-end supply chain cost model (including analyses of time and cost for containerized cargo transit between various markets in the U.S. and around the world); interviews with a variety of Louisiana stakeholders; interviews with shipping lines, railroads and other subject matter experts; and the comparative results gathered in a Port Attractiveness Framework, which examined the attributes of Louisiana’s current and potential ports relative to 35 leading North American ports.
For an electronic copy of the report, e-mail Matt Braud at email@example.com.